When do I need buildings insurance when buying a home?

Buildings insurance usually needs to start on the day you exchange contracts. Exchange is the point at which the purchase becomes legally binding and you become responsible for the building, so from that moment the risk sits with you, not the seller. Independent guidance is blunt about it: "You must insure your new property from the point you exchange contracts, which is the time you become liable for the bui"¹. Most mortgage lenders make cover a condition of the loan, so the policy is not optional in practice even though it is not a legal requirement in its own right².

The exception is Scotland, where the trigger is the date of entry rather than exchange, and new builds, where cover normally starts at completion instead. Leasehold flats are often insured by the freeholder, so a buyer may not need their own buildings policy at all.

What the policy has to cover is the cost of rebuilding the property, not the price you paid for it. Those two figures are usually different, and insuring for the wrong one is the most common way buyers end up underinsured.

Buildings insurance usually starts on the day you exchange contracts

Exchange of contracts is the moment the deal becomes binding on both sides, and it is also the moment responsibility for the building moves to the buyer. Guidance for home buyers states that cover must be in place from that point, and lenders' own product pages say the same: cover should commence on the day you exchange contracts and the home is legally yours¹. One lender's home buying guide puts it as a condition: buildings insurance must be in place from exchange of contracts to cover the structure of the property¹³.

If you are selling one home and buying another, the same date applies to the new property, and your existing policy needs to run alongside it rather than stop early⁴. The practical consequence is that the policy has to be bought and paid for before exchange, not after, because exchange can happen quickly once searches and the mortgage offer are in place. See exchange of contracts and completion for how the two dates fit together.

The reason the date matters so much is what happens if something goes wrong in the gap. Once contracts are exchanged, the buyer is responsible for insuring the property and for having repairs carried out¹⁴. A fire, a burst pipe or storm damage between exchange and completion is the buyer's problem, and the seller has no obligation to fix it. That gap can run for weeks.

Scotland: cover from the date of entry

In Scotland the process works differently and so does the insurance deadline. There is no exchange of contracts in the English sense; offers are made and accepted, and the binding date is the date of entry, when the buyer takes possession. Lenders state that in Scotland buildings insurance must be in place before the completion date known as the date of entry, and that you will need insurance in place from the date of entry⁴.

Mortgage conditions spell out the split: for purchases the insurance must be in place for exchange of contracts, and if you are buying in Scotland, from the date of completion¹⁵. Independent Scottish guidance adds that you might need buildings insurance for the move-in date in order to get your mortgage approved, so the policy can be a condition of the loan being released at all¹⁶.

Where a property is managed by a property factor, the factor has duties that include making sure there is appropriate building insurance and giving you proof of insurance if you ask for it¹⁷. That is worth knowing if you are buying a flat in Scotland, because it may mean the building itself is already covered and your own policy is not needed. Buying in Scotland more generally is covered in buying a home in Scotland.

Why your mortgage lender insists on it

Buildings insurance is not a legal requirement, but you may struggle to get a mortgage without cover in place³. Lenders treat it as security: the property is what they can sell if the loan is not repaid, so they need it protected against fire, flood and subsidence. One lender states plainly that it is a condition of the mortgage agreement that you always have a valid buildings insurance policy in place¹⁸. Another says most mortgage lenders will require you to hold buildings insurance¹⁹.

The condition usually comes with a minimum. Buildings insurance will be a condition of the mortgage and must be at least enough to cover the outstanding mortgage⁷. That is a floor, not a target: the policy can cover the full cost of rebuilding the property, which may be more or less than the loan. If a lender repossesses your home, you remain responsible for insuring it until it is sold, and you need to tell your insurer you are no longer living there, otherwise you may not be covered⁷.

What the lender cannot do is force you to buy its policy. You do not have to buy insurance from your mortgage lender, and a lender that offers its own buildings insurance cannot oblige you to take it¹¹. The requirement is that cover exists and is adequate, not who provides it.

Insure for the rebuild cost, not the price you paid

The sum insured on a buildings policy is the amount it would cost to rebuild the home from scratch, and that is usually lower than the market value of the property⁸. Independent guidance is clear that you need to insure yourself for the amount it would cost to completely rebuild your home, which is usually less than the sale price⁷. Buildings insurance is based on this rebuild cost, not the market value²⁰.

Getting it wrong is expensive in a specific way. If the rebuild cost of your home is £400,000 but you valued it at £200,000 in your insurance policy, you are 50% underinsured, and some insurers would only pay 50% of a claim, leaving the consumer to pay the rest²¹. The same principle applies more gently: if you are insured for less than it costs to repair or rebuild your home, you will have to pay more towards the work²².

Rebuild cost is not the same as what you paid, and it moves with construction costs rather than house prices. A valuation for mortgage purposes is not a rebuild cost assessment, and the two are often confused. If you are unsure of the figure, a rebuild cost calculator or a surveyor's assessment is the usual route.

What happens if the house is damaged between exchange and completion

The buyer carries the risk from exchange, which surprises many people. In England, it is the buyer's responsibility to insure the property from the date of exchange of contracts and to have the repairs carried out¹⁴. Once you have exchanged contracts, you are responsible for the property's building insurance, so cover needs to be in place in case anything happens before completion²³.

In practice this means a survey or valuation done before exchange tells you the condition of the property at that point, but not what it will be at completion. If damage occurs in between, the buyer's policy responds, and the buyer arranges the repairs. There is no automatic right to renegotiate the price or walk away, because the contract is binding.

New builds work differently. If you are buying a new-build property, the insurance does not need to come into effect until the day of completion⁶. Some shared ownership and co-ownership schemes set their own rule: with Co-Ownership in Northern Ireland, buildings insurance must be arranged before completion, start from the completion date and cover the full value of the property as a requirement of the agreement²⁴. One lender states that buildings cover needs to start on your completion date²⁵. New build warranties are a separate protection and are covered in new home warranties.

When you may not need your own buildings cover

Several situations mean a buyer does not need a standalone buildings policy.

• Leasehold flats and maisonettes. If you live in a leasehold flat or maisonette, it is likely that the freeholder will already have buildings insurance²⁶. Independent guidance says the same: if it is a leasehold flat, the building may be insured by the freehold landlord⁷. Check what the freeholder's policy covers, including flood risks and repair costs²⁷.
• Renters. If you rent, your landlord is responsible for buildings insurance, and you need your own cover only for personal belongings¹⁹. If you are renting you probably do not need buildings cover⁷.
• Contents. Unlike buildings insurance, you do not need contents insurance to buy a house⁷. It is a separate product covering TVs, furniture and similar items, and it is not a mortgage condition.

Buildings insurance covers the structure of the building, including roofs, windows and walls, plus permanent fixtures such as baths and toilets, but not the contents²⁸. What is included depends on the provider and the level of cover: damage from flood, fire or wind may be covered, but this varies²⁹. Some insurers will not cover damage to patios, garden walls or driveways unless the main building is affected¹⁹.

Empty properties, buy-to-let and long absences

Cover can lapse when a property is left empty, which matters for anyone buying a property they will not move into straight away. Most buildings insurance will lapse if the property is empty for more than 30 days⁹. The same warning appears in bereavement guidance: if the property is empty for more than 30 days, most buildings insurance will stop¹⁰. Where a borrower has died, the mortgaged property must continue to be insured under a comprehensive buildings insurance policy until it is sold³⁰.

Landlord policies are more flexible but still limited. Landlord insurance may cover an empty property for up to three months between tenants, but this varies¹⁹. If a property will be unoccupied for long periods, specialist buildings insurance may be needed¹³.

Buy-to-let buyers have a firmer obligation than owner-occupiers in one respect: under the terms of the mortgage, you must have buildings insurance in place, covering structural damage and the cost of rebuilding³¹. Lender terms state that the property must be covered by buildings insurance for as long as it is security for money that you owe³². Scottish guidance for buyers notes you will usually need to get buildings insurance for the move-in date³³.

Choosing a policy and what protects you

You are free to choose your own insurer, and a lender's own policy is one option among many rather than a requirement¹¹. When comparing, the sum insured matters more than the premium: a cheap policy on the wrong rebuild cost is not cheaper in the event of a claim. It is also worth checking what is excluded, since cover depends on the provider and the level and type of cover chosen²⁹.

On cost, no average premium is quoted here. What is documented is commission: an official review found commissions were often at least 30% of the total insurance premium, with some commissions being over 50%³⁴. That is a reason to look at the total price rather than assume a policy sold alongside a mortgage is competitive.

If something goes wrong, the Financial Ombudsman Service handles complaints about home insurance, including disputes about underinsurance²¹. Its published complaints data records 1,766 buildings insurance complaints opened in the first quarter of 2026/27, with 33% upheld, against 1,668 complaints in the same quarter of 2025/26³⁵. Free, impartial help on insurance and budgeting is available from Citizens Advice and MoneyHelper, and Shelter England has guidance if your home is flooded³⁷.